Closed-end funds and evergreen funds are types of investment funds with distinct characteristics. Each offers different benefits and considerations for investors.
closed-end private equity funds
- Offer a finite investment period with a planned timeline for exits to maximize return1
- Concentrate on specific opportunities within a set timeframe for capital deployment
- Typically deliver strong performance by leveraging focused strategies and active management
- Given the closed-end structure, investors can generally expect their commitments to be locked up in the investment for 10+ years
evergreen funds
- Maintains an indefinite investment horizon allowing for perpetual capital reinvestment
- Provides consistent exposure to private equity opportunities without predefined exit timelines
- Often prioritizes diversification across multiple dimensions with the goal of mitigating risk and capturing opportunities on a rolling basis
- Investors have the option to request a redemption/repurchase of their interests for liquidity throughout the life of the investment2
Hypothetical Investment of $100k: Closed-End Fund3
Hypothetical Investment of $100k: Evergreen Fund3
Open-end, perpetual, and evergreen funds share the common trait of offering continuous investment opportunities with no set maturity date; they simply use varied terminology to describe this structure.
To see a comprehensive list of terms with definitions, visit the Advisor Academy Glossary >
Notes & Disclosures
1. There can be no guarantee as to the timing or attractiveness of liquidity events as past performance is not a guarantee of future results and investments are subject to loss, including a complete loss, of capital.
2. There can be no guarantee that an investor will be able to liquidate its position in an evergreen fund when requested as the ability to realize a repurchase/redemption may by limited under the fund’s governing documents which may establish a “gate” or cap maximum quarterly repurchases/redemptions and/or allow the amount eligible for redemption/repurchase (whether up to or in excess of the cap) to be determined in the sole discretion of the the GP.
3. Hypothetical Performance. Any hypothetical performance has been provided for illustrative purposes only, and is not necessarily, and does not purport to be, indicative, or a guarantee of future results. Hypothetical performance includes any performance targets, projections, multi-fund composites, pro forma returns adjustments or other similar presentations and represents performance that no individual fund, portfolio or investor has actually achieved. The preparation of such information is based on underlying assumptions, and because it does not represent the actual performance of any fund, portfolio or investor, it is subject to various risks and limitations that are not applicable to non-hypothetical performance presentations. Any preparation of hypothetical performance involved subjective judgments. The use of different assumptions would produce different results.
Important Considerations: This information (the “Paper”) is provided for educational purposes only and is not investment advice or an offer or sale of any security or investment product or investment advice. Offerings are made only pursuant to a private offering memorandum containing important information. Statements made herein generally represent a mixture of (i) objective data attained through a variety of sources which are available upon request, as well as (ii) Adams Street’s analysis and related beliefs, opinions and views based on market observations, historical deal flow, experience and/or other factors; provided, however, that there can be no guarantee that this represents a complete universe of relevant data or opinions. Statements made represent current views and opinions as of February 2025 and are subject to change without any further obligation to update. All information has been obtained from sources believed to be reliable and current, but accuracy cannot be guaranteed. References herein to specific sectors, general partners, companies, or investments are not to be considered a recommendation or solicitation for any such sector, general partner, company, or investment. This Paper is not intended to be relied upon as investment advice as the investment situation of individuals is highly dependent on circumstances, which necessarily differ and are subject to change. The contents herein are not to be construed as legal, business, or tax advice, and individuals should consult their own attorney, business advisor, and tax advisor as to legal, business, and tax advice. Past performance is not a guarantee of future results and there can be no guarantee against a loss, including a complete loss, of capital. Certain information contained herein constitutes “forward-looking statements” that may be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “intend,” “continue,” or “believe” or the negatives thereof or other variations thereon or comparable terminology. Any forward-looking statements included herein are based on Adams Street’s current opinions, assumptions, expectations, beliefs, intentions, estimates or strategies regarding future events, are subject to risks and uncertainties, and are provided for informational purposes only. Actual and future results and trends could differ materially, positively or negatively, from those described or contemplated in such forward-looking statements. Moreover, actual events are difficult to project and often depend upon factors that are beyond the control of Adams Street. No forward-looking statements contained herein constitute a guarantee, promise, projection, forecast or prediction of, or representation as to, the future and actual events may differ materially. Adams Street neither (i) assumes responsibility for the accuracy or completeness of any forward-looking statements, nor (ii) undertakes any obligation to update or revise any forward-looking statements for any reason after the date hereof. Also, general economic factors, which are not predictable, can have a material impact on the reliability of projections or forward-looking statements. Adams Street Partners, LLC is a US investment adviser governed by applicable US laws, which differ from laws in other jurisdictions.
